Is this trend a good trading opportunity?

Will Drax turn, or will it maintain momentum beyond 393p?

• The chart shows Drqx price action since 20 September.
• Shares +10.7% since September lows.
• Will momentum continue towards May 2015 highs of 437p?
• Shares -1.3% from 2018 highs; +79.3% from 2018 lows; +45% year-to-date
• Currently trading at 393p (as of the time of writing).
• Utilities considered both defensive in times of market uncertainty
• 24 Sept: Drax in talks to buy UK assets from Spain’s Iberdrola

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Trading Drax – An Example

Let’s say the trend appeals to you, you think it’s likely to continue. You decide to buy exposure to £10,000 worth of Drax using a CFD, at the current price of 393p. To do this, you need £2,000.

Let’s assume Drax trend continues to May 2015 highs of 437p (+11.1%). Your profit would be £1111, from your initial investment of £2,000.

Conversely, let’s assume you open the above position, and place a stop-loss at 4% below the current price. Drax falls 4% and hits your stop-loss. Your loss would be £400.

This is provided for information purposes only. It should not be taken as a recommendation.